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FEDERAL RESERVE OF NEW BANK YORK f Circular No. 2 7 0 6 1 I October 7, 1943 J SECURITIES IN THE TERRITORY OF HAWAII To Banks, Trust Companies, Brokers and Dealers in Securities, and Others Concerned, in the Second Federal Reserve District: For your information we quote below tlie text of Regulations Relating to Securities, dated September 2, 1943, issued by the Governor of Hawaii, and the text of a press release, dated September 2, 1943, entitled "Securities Regulations Relaxed". EXECUTIVE CHAMBERS Honolulu, T. H. September 2, 1943. REGULATIONS RELATING T O SECURITIES, AS AMENDED, UNDER EXECUTIVE ORDER NO. 8389, AS AMENDED, EXECUTIVE ORDER NO. 9193, SECTIONS 3(a) A N D 5(b) OF T H E TRADING W I T H T H E ENEMY ACT, AS AMENDED BY T H E FIRST W A R POWERS ACT, 1941, RELATING TO FOREIGN FUNDS CONTROL. The Regulations Relating- to Securities of July 3, 1942, as amended,* are hereby further amended to read as follows: 1. Perforation of Securities. (a) On or before August 1, 1942 all securities within the Territory of Hawaii shall be perforated with the official symbol " H " by a domestic bank in such Territory, or by such other persons as may be designated. Every person shall satisfy himself that all securities within his possession or custody in the Territory of Hawaii on August 1, 1942, and at all times thereafter, have been duly perforated with the official symbol " H " . Machines for perforating securities with the official symbol " H " will be furnished to such domestic bank. (b) All securities brought into the Territory of Hawaii after July 3, 1942 shall be immediately delivered to a domestic bank, or to such other person as may be designated, for perforation with the official symbol " H " . ( c ) All securities issued in the Territory of Hawaii after September 2, 1943 shall, immediately after issuance, be perforated with the official symbol " H " by or at the direction of the issuer or its transfer agent. (d) No person shall receive or hold within the Territory of Hawaii any securities which have not been perforated with the official symbol " H " . 2. Restrictions on Exportation of Perforated Securities. Except as authorized by a license or other authorization of the Governor of Hawaii, no security may, after July 3, 1942, be exported or otherwise physically taken from the Territory of Hawaii unless Form T F E L - 2 , issued pursuant to Executive Order No. 8389, as amended, has been previously attached to such security. Application for the attachment of Form T F E L - 2 may be filed with the Office of the Governor of Hawaii, Foreign Funds Control, on Form T F R - H 2 8 . Such application shall set forth a complete description of the security and the circumstances surrounding its exportation or shipment from the Territory of Hawaii. (* Regulations Relating to Securities, dated July 3, 1942, as amended by Amendment No. 1, dated August 4, 1942, are set forth in Federal Reserve Bank of New York Circular No. 2487, dated August 20, 1942.) (OVER) 3. Definitions. As used in these regulations: (a) The term "domestic bank" means any branch or office within the Territory of Hawaii of any bank or trust company incorporated and doing business under the laws of the United States or of the Territory of Hawaii relating to the operation of banks or trust companies. (b) The term "securities" shall not be deemed to apply to United States Defense and War Savings Stamps or to non-transferable United States Government Securities, including United States Defense and War Savings Bonds, of all series and designations ; United States Adjusted Service Bonds; and United States Treasury Notes, Tax Series A - 1943, B - 1943, A - 1944, and B -1944. 4. Former Regulations in Effect for Certain Purposes. The Regulations Relating to Securities, as issued by the Governor of Hawaii on July 3, 1942, and amended on August 4. 1942, are hereby continued in full force and effect as to all acts done or omitted to be done and any penalties or liabilities incurred prior to the issuance of this amendment. INGRAM M . STAINBACK Governor of Hawaii PRESS R E L E A S E September 2, 1943 SECURITIES REGULATIONS RELAXED Foreign Funds Control officials today announced that Governor Stainback has signed an amendment to the Regulations Relating to Securities whereby securities are no longer required to be held in custody accounts with banking institutions. In conjunction with this relaxation, Governor Stainback has revoked the Regulations Relating to Safe Deposit Boxes, which prohibited the keeping of securities in private depositories.* However, all persons holding securities must see that such securities, regardless of their value, are perforated with the official symbol " H " . Only war bonds and other non-negotiable U.S. Government issues need not be so perforated. Persons desiring to send or take securities from the Territory may do so only after obtaining the attachment of Form T F E L - 2 to such securities. Applications for the attachment of this form may be filed with the Office of the Governor of Hawaii, Foreign Funds Control, on Form TFR-H28. Applications should set forth a complete description of the securities and the circumstances surrounding their exportation. The amended regulations dispense with reporting requirements, including the obligation of Hawaiian corporations to report changes in their security holders of record. Officials stated that relaxation of the securities regulations is made possible by existing conditions as contrasted with those of 13 months ago when the regulations were first introduced as a "scorched earth" measure. It is felt that perforation will provide a reasonable safeguard against securities in Hawaii becoming of value to the enemy if they should fall into his hands. Additional copies of this circular will be furnished upon request. ALLAN SPROUL, President. (* Regulations Relating to Safe Deposit Boxes, dated August 13, 1942, issued by the Governor of Hawaii are set forth in Federal Reserve Bank of New York Circular No. 2490, dated August 25, 1942.)